Home Depot (HD) tops estimates but remains under pressure

As the housing market continues to struggle, Home Depot began eliminating jobs in order to help out its bottom line. The company has announced that it was shedding 7,000 jobs this year, and put in place a salary freeze for its officers as it tries to cope with slowing sales.

Sales for its first quarter dropped 10% to $16.18 billion, and while no one likes to see dips in sales, this was at least above analyst estimates of $15.86 billion for the quarter.

Despite coming in above analyst estimates for earnings and sales, the stock is still getting hit mainly due to the company's decision not to boost its full year guidance. For the full year 2009, analysts are anticipating profit of $1.35 per share, and sales of $65.03 billion.

Another reason why traders are selling off the stock today is the feeling that Home Depot should have compared better with the results of it main competitor Lowe's (NYSE: LOW), which reported first quarter earnings yesterday. Home Depot reported that same store sales were off by 10.2% during the quarter, while Lowe's showed only a 6.6% drop in its same store sales. Lowe's also lifted its full year guidance, a move Home Depot was not able to match.

Home Depot's CEO, Frank Blake stated that "Our markets, and the consumer in general, remain under pressure."

Shares of Home Depot have dropped 4.2% in morning trading, down $1.11 to $24.91.